ABA files amicus brief urging Supreme Court to uphold FCC's role as primary interpreter of FCC
Telephone Consumer Protection Act
PDR Network, LLC v. Carlton & Harris Chiropractic Inc.
Date: February 14, 2019
Issue: Whether the Hobbs Act requires the district court to accept the Federal Communication
Commission’s (FCC) legal interpretation of the Telephone Consumer Protection Act (TCPA).
Case Summary: ABA filed an amicus brief urging the Supreme Court to rule that the Hobbs Act requires district courts to accept the FCC’s interpretations of the TCPA.
The TCPA defines “unsolicited advertisement” as “any material advertising the commercial availability or quality of any property, goods or services” sent without prior permission. However, the FCC promulgated a final rule in 2006, providing that faxes that “promote goods or services even at no cost, such as free magazine subscriptions, [or] catalogs … are unsolicited advertisements under the TCPA’s definition.” Moreover, the Hobbs Act provides that any challenge to the “validity” of an FCC order must be filed in a federal court of appeals—not district court—within a specified time from the order’s issuance.
Carlton & Harris, a chiropractic firm, sued PDR Network when it received an unsolicited fax inviting it to download a free copy of the Physician’s Desk Reference, published by PDR as an e-book. Carlton & Harris claimed the fax violated the TCPA’s ban on unsolicited fax advertisements, because the fax was not an “advertisement.” While PDR does not charge for the book, drug companies pay PDR to list their drugs in the book along with prescribing information.
The district court ruled that the word “advertisement” as used in the TCPA clearly implied some commercial purpose, and that a fax offering to give away a free book was not an advertisement. On appeal, the Fourth Circuit reversed, ruling that the FCC’s Rule was not properly challenged in the federal court of appeals, and that the district court was therefore bound to apply the FCC’s definition of “advertisement” under the Hobbs Act.
In its certiorari petition, PDR urged the Supreme Court to review the case to resolve a circuit split regarding the deference to be shown to FCC rules interpreting the TCPA. PDR also argued that district courts should be free to engage in a Chevron analysis, meaning the courts can disregard agency interpretations if they find Congress’ language unambiguous. On November 13, 2018, the Supreme Court granted PDR’s certiorari petition.ABA filed an amicus brief supporting Carlton & Harris. The brief asserted that the Hobbs Act provides banks and other regulated entities with certainty that consumer-protecting messages can be sent most efficiently and in compliance with the TCPA. According to ABA, the Act places regulation of interstate telephone communications squarely in the hands of the FCC and prescribes a streamlined process for challenging that agency’s final orders. Further, if collateral attacks on FCC orders are permitted outside of the Hobbs Act framework, ABA asserted that financial institutions will face perpetual uncertainty concerning their compliance obligations under the TCPA. As a result, TCPA regulation will be deprived of
its nationwide uniformity and undermine financial institutions’ compliance measures taken in reliance on FCC orders. The brief pointed out that efficient, effective communications are essential if banks are to serve their customers and comply with their regulatory obligations.
Bottom Line: Oral argument is scheduled for March 25, 2019.
Download the amicus brief to read the full text.
